Niti Aayog Fixing Regulation Service Sector Doctors Lawyers Engineering Nursing Licensure Next Gdp Icai

Changes proposed by NITI Aayog to the regulation of professional services could soon affect how professionals enter and operate in service-sectors such as law, accounting, architecture, engineering and healthcare. The recommendations made covers professional licensing, recognition of qualifications, business structures, interstate licence portability and mutual recognition arrangements with other countries. The National Institution for Transforming India (NITI) Aayog said services accounted for 55 per cent of India’s Gross Domestic Product (GDP) in the financial year-24. India was also the seventh-largest exporter of services globally, accounting for 4.3 per cent of global services exports that year. Further, it notes, professional and management consulting services accounted for nearly a fifth of India’s services exports in 2024-25. What are the regulatory changes being examined? The report identifies gaps across professional services in areas such as recognition of professionals, market entry, licensing, permissible business structures, professional mobility and regulatory overlaps. These issues differ across sectors. For legal services, the report examines the recognition of different categories of legal professionals, the treatment of foreign lawyers and law firms, restrictions on business structures and advertising norms. In accounting and auditing, it looks at restrictions on foreign professionals, the respective roles of the Institute of Chartered Accountants of India (ICAI) and the National Financial Reporting Authority (NFRA), as well as the regulatory framework for bookkeeping. Similar regulatory issues are examined for architecture, engineering, healthcare and allied healthcare services. The report also points to areas where regulatory processes could be made more consistent. In healthcare, it highlights multiple layers of overlapping regulation and the absence of a unified system for interstate licensure mobility. This means professionals do not currently have a single system through which licences can be transferred across states within the country, further that it become more complicated with the intake of foreign medical graduates. For engineering, the report notes the absence of a comprehensive statutory framework governing the practice of engineers. Why professional qualifications and mobility matter The report also looks at professional mobility and recognition of qualifications, particularly in areas where India does not have adequate mutual recognition arrangements with other countries. It also compares India's framework with selected countries on market access, business structures, professional licensing, recognition of qualifications and regulatory practices. For example, the report notes that architects in India can establish commercial presence mainly through sole proprietorships and partnerships. Limited Liability Partnerships (LLPs) and incorporated companies are permitted in countries such as the UK, New Zealand and Singapore. These comparisons form part of the assessment used by the report while making its recommendations. Four areas identified for the services sector A dedicated chapter of the report sets out the proposed way forward. It identifies four broad priorities: continuous professional development, adoption of best practices in professional services, elevating professional services within the services value chain, and advancing emerging trends in professional services. The report clarifies that these recommendations are intended as reference points for further discussion rather than as prescriptive measures. For legal services, the recommendations include considering wider statutory recognition of legal professionals, greater clarity on the regulatory treatment of foreign law firms, mutual recognition arrangements, revisiting advertising norms and allowing multidisciplinary practices with safeguards. For accounting, auditing and bookkeeping, the report recommends expanding mutual recognition agreements, strengthening regulatory oversight and skilling of bookkeepers, and creating phased accreditation pathways for qualified foreign professionals. For architecture, it proposes a professional licensing examination, streamlined registration, a wider range of permissible legal structures and mutual recognition agreements. For engineering, the report proposes a central statutory framework for engineers involved in construction and infrastructure-related activities, along with clearly defined scopes of practice. In healthcare and allied healthcare, the recommendations include timely implementation of the National Exit Test (NExT), greater regulatory clarity, interstate licence portability, full operationalisation of the National Commission for Allied and Healthcare Professions Act (NCAHP) and mutual recognition arrangements. Focus shifts to higher-value professional work The report places the regulatory recommendations alongside changes taking place in professional services. It identifies research and development, strategic technology operations, engineering design and consulting as areas linked to a shift towards higher-value, knowledge-intensive activities. Artificial intelligence, the green transition and geopolitical uncertainty are also identified as trends reshaping demand for professional services. According to the report, artificial intelligence and automation are changing how services are delivered while creating demand for areas such as advanced analytics and strategic advisory services. For students and professionals, the areas highlighted in the report include professional licensing, recognition of qualifications, continuing professional development, accreditation and mobility. In some sectors, the proposed changes also concern the types of business structures through which professionals can operate.